Promotion of Enterprise. Bukovyna Fund

Bukovyna Fund

The President of the Federation of Employers of Ukraine, Head of the Board of Directors of Group DF Mr. Dmitry Firtash has initiated the establishment of a venture investment fund aimed at supporting small enterprise by creating preconditions for realization of business ideas featuring a lucrative commercial potential. ‘Bukovyna’ has become Ukraine’s first investment fund offering preferential lending support to small businesses. Furthermore, ‘Bukovyna’ is the only fund financing the development of promising ideas ‘from scratch’ in all sectors of the economy.

“Anyone must have access to having his or her business idea realized,” said Dmitry Firtash while meeting with Chernivtsi region administration and business community in February 2012. “Today, young people are unable to promote their ideas, no matter in what field. Banks won’t lend to them. Who can a student turn to? To their parents or their parents’ friends – a closed circuit,” said Mr. Firtash.

The presentation of ‘Bukovyna’ Fund took place on April 23 in Chernivtsi. According to the presented data, the capital managed by the Fund equals 3 million UAH.

The bulk of the Fund’s capital was donated by its initiator, President of the Federation of Employers of Ukraine Dmitry Firtash. Four Chernivtsi business people have signed up to the fund: Ms. Stella Stankevych, Chairwoman of the Board of Directors, ‘Trembita’ company; Mr. Vyacheslav Dobrovolsky, Preseident, ‘TechnoPlus’ company; Mr. Victor Sidliar, CEO, ‘Chernivtsi mashzavod’; and Mr. Ivan Semeniuk, CEO ‘Rodnichohk’ company.

Financing will be provided along two lines: preferential lending and equity investment.

Preferential loans in the amount ranging from 100 to 320 thousand UAH at a 5 to 15 percent interest rate will be available to existing companies offering innovative products and services to the market.

The authors of new business ideas can qualify for receiving 50 to 80 thousand worth of a startup capital for launching their business. Notably, ownership in the projects will remain in their authors’ hands which the Fund’s interest in such enterprises will vary within a 10-49 percent range. In case that a project is successfully realized, the Fund’s margin will be earned from selling its share in the enterprise while the receipts will be reinvested in new projects.

In September of 2012 ‘Bukovyna’ invested the first 1 million hryvnias in the implementation of six projects proposed by Chernivtsi-based entrepreneurs. Three of them winning the total of 200 thousand UAH talk about founding business from scratch. The remaining three projects to which the total of 800 thousand UAH worth of preferential loans will be provided envisage business development operations.

Dmitry Firtash attending the projects presentation underscored the commercial implications of supporting small and medium businesses. “I have decided to invest an additional 5 million UAH in ‘Bukovyna’ fund,” pledged Mr. Firtash. Thus, the fund’s capital has reached the total of 8 million UAH.

“This fund enables realization of the boldest business ideas. It offers equal startup opportunities irrespective of the capital amounts and connections. What really matters is promising ideas, knowledge, commitment and willingness to succeed,” said Mr. Firtash.